BP to install bigger cap on leak well

California, July 10, 2010

British energy giant BP is all set to install a bigger cap that could contain almost all the oil leaking from its blownout Gulf of Mexico well, a top US official said.

The Obama administration has been pressing the company to install the new cap, which could capture up to 80,000 barrels of oil a day, versus the 25,000 barrels currently being contained.

The government has estimated the well is leaking a maximum of 60,000 barrels a day, although independent estimates have been as high as 100,000 barrels a day.

Retired Coast Guard Admiral Thad Allen, who is overseeing the response to the spill, told a news conference that the well could be contained - but not plugged - by Sunday or Monday, when the cap was installed on top of it.

'When we have the cap on, and it's sealed and we know that we've got a seal, yes' (it will be contained), Allen said.

BP has been under enormous pressure to halt the oil, which has polluted coastlines on all five US Gulf states, threatened multi-billion dollar fishing and tourism industries and killed birds, sea turtles and dolphins.

It is the worst offshore oil spill in US history. The company's costs for the spill likely will be tied to the amount of oil that ultimately flows out of the well.

Allen, however, reiterated that the well will not be plugged until two relief wells were completed, expected to be in mid-August. He said later BP had responded to a government request to lay out a timeline for installing the new cap.

'We're reviewing it right now,' Allen told Reuters. 'If there are no problems with it, we'll probably authorize them to move ahead later on this evening.'

'It looks like it's achievable at this point if we remain on schedule,' Allen said. 'If we approve the timeline, we would start tomorrow to remove the current cap and to start the sequence of events.'

The spill has complicated the US relationship with Britain, while subjecting Obama to fierce criticism that his handling of the disaster has been too slow.

The administration reiterated on Friday that it would announce a new deepwater oil drilling moratorium, a pledge that came after a US appeals court refused to reinstate a six-month ban on drilling below 500 feet.

'In the next several days we'll be making an announcement about keeping the moratorium in place,' Interior Secretary Ken Salazar said during a visit to California. 'It will be a new moratorium,' he added.-Reuters